Taxpayers generally must compute the tax on both the net income base and the net worth base and pay the tax on the base that produces the greater tax. The maximum net worth base tax liability is $150,000. However, different rules apply to financial institutions and qualifying holding companies. Financial institutions are not subject to the tax on the net income base, but financial institutions are subject to the net worth base tax at a higher rate than other corporations, and the $150,000 net worth tax limit does not apply to financial institutions. Qualifying holding companies are not subject to the tax on the net worth base, but are subject to the tax on the net income base.

For those taxpayers subject to the franchise tax phase-out, the tax is multiplied by the phase-out factor. Please refer to FAQ #4 regarding the franchise tax phase-out.